Insurtech Lemonade Enters ‘Green’ Auto Insurance Business
Home, renters and pet insurer Lemonade is deploying its artificial intelligence, behavioral economics and social good mantra with its newest product, Lemonade Car.
Lemonade Car is designed to offer better auto insurance prices for safe and low-mileage drivers, as well as environment-friendly electric vehicles and hybrid cars. The Lemonade app uses telematics to measure how much and how safe people drive, as well as provide 24/7 on-location roadside assistance, real time crash detection, and dispatch of emergency services.
Lemonade Car is now available in Illinois, with Tennessee in line to be the next state as part of a planned nationwide rollout.
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The company announced its intention to enter the car insurance business earlier this year. The company started with homeowners products, adding pet insurance in the second half of 2020, and term life insurance in the first half of 2021.
Customers will automatically receive discounts when bundling with other Lemonade products including home, renters, pet, or life insurance.
Last July, Lemonade launched the first major insurtech IPO, raising more than $300 million.
Lemonade Car’s claims process allows users to file claims in minutes, and when needed, get tow services, emergency EV battery recharge, and the ability to track repairs, body shop work, and more.
As a public benefit corporation and B-Corp, Lemonade said it will continue its commitment to never invest in fossil fuels and polluting industries, as well as to incorporate incentives to reduce CO2 emissions.
“We wanted to introduce a product that will not only reinvent how people buy car insurance, manage their policy, and file claims, but also do something good for the planet. Since we can’t stop using cars just yet, we will help compensate for the CO2 emitted from our customers’ cars by financing reforestation on an ongoing basis. Using the telematics technology in our app, we’re able to estimate how much carbon dioxide is emitted by each ride, and plant trees accordingly,” said Shai Wininger, CEO and co-founder.
Lemonade has defended the use of artificial intelligence in insurance against claims it can be unfairly biased against gender, racial and ethnic minorities. According to Schreiber, everyone wants to be assessed as an individual, not by reference to racial, gender, or religious markers. “If the AI is treating us all this way, as humans, then it is being fair. If I’m charged more for my candle-lighting habit, that’s as it should be….,” he recently wrote.
Lemonade has said a “large majority” of its existing customers are car owners, and they already spend about $1 billion on car insurance each year.
Lemonade currently operates as a carrier in the U.S. and Germany, the Netherlands and France.
Source: Insurance Jornal
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